Exhibit 99.2
| G&K Services, Inc. and Subsidiaries | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Condensed Consolidated Statements of Operations | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| (In thousands, except per share data) | Quarter 1 F2013 | Quarter 2 F2013 | Quarter 3 F2013 | Quarter 4 F2013 | Fiscal 2013 | Quarter 1 F2014 | Quarter 2 F2014 | YTD Quarter 2 F2013 | YTD Quarter 2 F2014 | ||||||||||||||||||||||||||||||||||||||||||||
| Rental and direct sales revenue | $ | 210,594 | $ | 218,270 | $ | 217,743 | $ | 219,411 | $ | 866,018 | $ | 220,223 | $ | 225,919 | $ | 428,864 | $ | 446,142 | |||||||||||||||||||||||||||||||||||
| Cost of rental and direct sales | 143,754 | 68.3 | % | 148,892 | 68.2 | % | 148,095 | 68.0 | % | 144,970 | 66.1 | % | 585,711 | 67.6 | % | 144,505 | 65.6 | % | 148,320 | 65.7 | % | 292,646 | 68.2 | % | 292,825 | 65.6 | % | ||||||||||||||||||||||||||
| Gross Profit | 66,840 | 31.7 | % | 69,378 | 31.8 | % | 69,648 | 32.0 | % | 74,441 | 33.9 | % | 280,307 | 32.4 | % | 75,718 | 34.4 | % | 77,599 | 34.3 | % | 136,218 | 31.8 | % | 153,317 | 34.4 | % | ||||||||||||||||||||||||||
| Selling & Administrative | 47,908 | 22.7 | % | 47,097 | 21.6 | % | 48,296 | 22.2 | % | 53,001 | 24.2 | % | 196,302 | 22.7 | % | 52,149 | 23.7 | % | 49,903 | 22.1 | % | 95,005 | 22.2 | % | 102,052 | 22.9 | % | ||||||||||||||||||||||||||
| Income from Operations | 18,932 | 9.0 | % | 22,281 | 10.2 | % | 21,352 | 9.8 | % | 21,440 | 9.8 | % | 84,005 | 9.7 | % | 23,569 | 10.7 | % | 27,696 | 12.3 | % | 41,213 | 9.6 | % | 51,265 | 11.5 | % | ||||||||||||||||||||||||||
| Interest expense | 1,029 | 0.5 | % | 1,107 | 0.5 | % | 1,127 | 0.5 | % | 1,590 | 0.7 | % | 4,853 | 0.6 | % | 1,581 | 0.7 | % | 1,566 | 0.7 | % | 2,136 | 0.5 | % | 3,147 | 0.7 | % | ||||||||||||||||||||||||||
| Income from Continuing Operations before Income Taxes | 17,903 | 8.5 | % | 21,174 | 9.7 | % | 20,225 | 9.3 | % | 19,850 | 9.0 | % | 79,152 | 9.1 | % | 21,988 | 10.0 | % | 26,130 | 11.6 | % | 39,077 | 9.1 | % | 48,118 | 10.8 | % | ||||||||||||||||||||||||||
| Income tax expense | 6,398 | 3.0 | % | 8,307 | 3.8 | % | 6,620 | 3.0 | % | 7,321 | 3.3 | % | 28,646 | 3.3 | % | 8,378 | 3.8 | % | 9,787 | 4.3 | % | 14,705 | 3.4 | % | 18,165 | 4.1 | % | ||||||||||||||||||||||||||
| Net Income from Continuing Operations | $ | 11,505 | 5.5 | % | $ | 12,867 | 5.9 | % | $ | 13,605 | 6.2 | % | $ | 12,529 | 5.7 | % | $ | 50,506 | 5.8 | % | $ | 13,610 | 6.2 | % | $ | 16,343 | 7.2 | % | $ | 24,372 | 5.7 | % | $ | 29,953 | 6.7 | % | |||||||||||||||||
| Net income (loss) from discontinued operations | 389 | 0.2 | % | 354 | 0.2 | % | (23 | ) | — | % | (4,506 | ) | (2.1 | )% | (3,786 | ) | (0.4 | )% | 211 | 0.1 | % | (8,423 | ) | (3.7 | )% | 743 | 0.2 | % | (8,212 | ) | (1.8 | )% | |||||||||||||||||||||
| Net Income | $ | 11,894 | 5.6 | % | $ | 13,221 | 6.1 | % | $ | 13,582 | 6.2 | % | $ | 8,023 | 3.7 | % | $ | 46,720 | 5.4 | % | $ | 13,821 | 6.3 | % | $ | 7,920 | 3.5 | % | $ | 25,115 | 5.9 | % | $ | 21,741 | 4.9 | % | |||||||||||||||||
| Basic Earnings per Common Share: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| From continuing operations | $ | 0.61 | $ | 0.67 | $ | 0.70 | $ | 0.64 | $ | 2.62 | $ | 0.69 | $ | 0.82 | $ | 1.28 | $ | 1.52 | |||||||||||||||||||||||||||||||||||
| From discontinued operations | 0.02 | 0.02 | — | (0.23 | ) | (0.20 | ) | 0.01 | (0.43 | ) | 0.04 | (0.42 | ) | ||||||||||||||||||||||||||||||||||||||||
| Basic earnings per share | $ | 0.63 | $ | 0.69 | $ | 0.70 | $ | 0.41 | $ | 2.43 | $ | 0.70 | $ | 0.39 | $ | 1.32 | $ | 1.09 | |||||||||||||||||||||||||||||||||||
| Diluted Earnings per Common Share: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| From continuing operations | $ | 0.60 | $ | 0.66 | $ | 0.69 | $ | 0.63 | $ | 2.58 | $ | 0.68 | $ | 0.81 | $ | 1.26 | $ | 1.49 | |||||||||||||||||||||||||||||||||||
| From discontinued operations | 0.02 | 0.02 | — | (0.23 | ) | (0.20 | ) | 0.01 | (0.42 | ) | 0.04 | (0.41 | ) | ||||||||||||||||||||||||||||||||||||||||
| Diluted earnings per share | $ | 0.62 | $ | 0.68 | $ | 0.69 | $ | 0.40 | $ | 2.38 | $ | 0.69 | $ | 0.39 | $ | 1.30 | $ | 1.07 | |||||||||||||||||||||||||||||||||||
| Basic shares outstanding | 18,681 | 18,841 | 19,053 | 19,306 | 18,970 | 19,429 | 19,547 | 18,761 | 19,488 | ||||||||||||||||||||||||||||||||||||||||||||
| Diluted shares outstanding | 18,949 | 19,099 | 19,430 | 19,689 | 19,292 | 19,836 | 19,940 | 19,024 | 19,888 | ||||||||||||||||||||||||||||||||||||||||||||
| Income Allocable to Participating Securities | $ | (175 | ) | $ | (205 | ) | $ | (210 | ) | $ | (120 | ) | $ | (710 | ) | $ | (181 | ) | $ | (237 | ) | $ | (380 | ) | $ | (418 | ) | ||||||||||||||||||||||||||
| Net Income from Continuing Operations Available to Common Stockholders | $ | 11,330 | $ | 12,662 | $ | 13,395 | $ | 12,409 | $ | 49,796 | $ | 13,429 | $ | 16,106 | $ | 23,992 | $ | 29,535 | |||||||||||||||||||||||||||||||||||
| Net Income Available to Common Stockholders | $ | 11,719 | $ | 13,016 | $ | 13,372 | $ | 7,903 | $ | 46,010 | $ | 13,640 | $ | 7,683 | $ | 24,735 | $ | 21,323 | |||||||||||||||||||||||||||||||||||
| Non-GAAP Income from Operations: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| GAAP income from operations | $ | 18,932 | 9.0 | % | $ | 22,281 | 10.2 | % | $ | 21,352 | 9.8 | % | $ | 21,440 | 9.8 | % | $ | 84,005 | 9.7 | % | $ | 23,569 | 10.7 | % | $ | 27,696 | 12.3 | % | $ | 41,213 | 9.6 | % | $ | 51,265 | 11.5 | % | |||||||||||||||||
| Change in merchandise amortization lives | — | — | — | (2,605 | ) | (2,605 | ) | (2,273 | ) | (1,803 | ) | — | (4,076 | ) | |||||||||||||||||||||||||||||||||||||||
| Impact of pension withdrawal and associated expenses | — | — | — | 1,000 | 1,000 | 1,687 | — | — | 1,687 | ||||||||||||||||||||||||||||||||||||||||||||
| Restructuring and impairment charges | — | — | — | 3,161 | * | 3,161 | * | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Non-GAAP income from operations | $ | 18,932 | 9.0 | % | $ | 22,281 | 10.2 | % | $ | 21,352 | 9.8 | % | $ | 22,996 | 10.5 | % | 85,561 | 9.9 | % | $ | 22,983 | 10.4 | % | $ | 25,893 | 11.5 | % | $ | 41,213 | 9.6 | % | $ | 48,876 | 11.0 | % | ||||||||||||||||||
| Non-GAAP Net Income from Continuing Operations: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| GAAP net income from continuing operations | $ | 11,505 | $ | 12,867 | $ | 13,605 | $ | 12,529 | $ | 50,506 | $ | 13,610 | $ | 16,343 | $ | 24,372 | $ | 29,953 | |||||||||||||||||||||||||||||||||||
| Change in merchandise amortization lives | — | — | — | (2,605 | ) | (2,605 | ) | (2,273 | ) | (1,803 | ) | — | (4,076 | ) | |||||||||||||||||||||||||||||||||||||||
| Impact of pension withdrawal and associated expenses | — | — | — | 1,000 | 1,000 | 1,687 | — | — | 1,687 | ||||||||||||||||||||||||||||||||||||||||||||
| Restructuring and impairment charges | — | — | — | 3,161 | * | 3,161 | * | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Tax impact of above items | — | — | — | (542 | ) | (542 | ) | 199 | 678 | — | 877 | ||||||||||||||||||||||||||||||||||||||||||
| Non-GAAP net income from continuing operations | $ | 11,505 | $ | 12,867 | $ | 13,605 | $ | 13,543 | 51,520 | $ | 13,223 | $ | 15,218 | $ | 24,372 | $ | 28,441 | ||||||||||||||||||||||||||||||||||||
| Non-GAAP net income from continuing operations available to common shareholders | $ | 11,330 | $ | 12,662 | $ | 13,395 | $ | 13,423 | $ | 50,810 | $ | 13,042 | $ | 14,981 | $ | 23,992 | $ | 28,023 | |||||||||||||||||||||||||||||||||||
| Non-GAAP net income from continuing operations per diluted share | $ | 0.60 | $ | 0.66 | $ | 0.69 | $ | 0.68 | $ | 2.63 | $ | 0.66 | $ | 0.75 | $ | 1.26 | $ | 1.41 | |||||||||||||||||||||||||||||||||||
| Notes: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| * Restructuring charges totaling $6,672 that were previously reported as a non-GAAP adjustment related to our GKDirect Program group and have been reclassified as Discontinued Operations. | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Purpose of Schedule: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| The purpose of the above schedule is to restate the condensed consolidated statement of operations to reflect the effects of the discontinued operations for each quarter of fiscal 2013 and fiscal 2014. | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Reconciliation of GAAP to Non-GAAP Financial Measures | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| The company reports its consolidated financial results in accordance with generally accepted accounting principles (GAAP). To supplement these consolidated financial results, management believes that certain non-GAAP operating results provide a more meaningful measure on which to compare the | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| company’s results of operations between periods. The company believes these non-GAAP results provide useful information to both management and investors by excluding certain amounts that impact comparability of the results. A reconciliation of operating income and net income from continuing | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| operations on a GAAP to non-GAAP basis is presented in the table above. These non-GAAP measures are not in accordance with, or an alternative for measures prepared in accordance with, GAAP and may be different from non-GAAP measures used by other companies. Investors should consider | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| non-GAAP measures in addition to, and not as a substitute for, or superior to, financial performance measures prepared in accordance with GAAP. | |||||||||||||||||||||||||||||||||||||||||||||||||||||